growth models in Europe

16Jul08

“The French growth model has been built almost exclusively on consumer demand and construction, the direct opposite of the German model of export-led growth,” Mr Moëc said. “In a country so dependent on consumer demand, when real wages growth turns negative it is a real disaster.” (FT.com, Economic outlook clouds Sarkozy success)

It’s true, economists are entitled to get preoccupied, frenzied and excited over changes in inflation rates and growth prospects. I’m just wondering whether this cloud looming over France is not “only” a reaction to what’s been going on in the world. France is by no means an island in this global world.